Theres just not a great deal of good info on stop losses out there. A lot of ideas, but who is right....or ummm righter than the other person. Im just after a general feel of what a stop loss should be.
Who's right? Well the short answer is that they are probably all right. What sort of stop you use, and how tight your stop should be, really depends on your trading timeframe, the type of system you're using, volatility of stock, how strongly the stock is trending, etc, etc. You really need to find out what works for you, your trading style, and the type of stocks you trade. This takes time, particularly if you are new to trading and don't yet know what your trading style is. It took me about 4-5 years before everything began to gel and come together for me,...... and then the market changed and I've had to go back to the drawing board.....
I understand how you get those numbers and what they are there for, I just want to know what would be your stop loss on your entire capital (because i generally put the whole lot in over a few separate trades). So if my calcs are correct it would be about 10%.....right?
I'm not sure if you have completely grasped the concept. Have a read on 'Fixed Fractional Position Sizing'. This sets a max. loss on any one trade (not the total trades on at any given time) to a certain % of your total account equity. A number of authors suggest a figure of 2%, but quite a few traders say this is too much and quote figures like 1%. I've used at various times figures from 0.5% up to 1.5%. These figures may not be practical to you, particularly if you have a small account size.
If you want some rough figure though, yes, 10%, for me, would be somewhere near to what it would work out to be over the whole portfolio. So that's about 8 trades with 1.25% risk per trade. ie. 8 x 1.25% = 10%. The trade risk, for me, may be anywhere from say 5% up to 15% or so of the trade value, but the position sizing is adjusted to equal say 1.25% of the total account equity.